Bitcoin Price Remains Stuck in a Tight Range
All was relatively quiet in the absence of Wall Street, but the Bitcoin and crypto markets may not be silent for long.
Bitcoin (BTC) price hovered around $43,000 on Jan 17 as “boring” price action combined with signs that the market might be stabilizing.
Bitcoin 1 hour chart (BTC/USD)
Leverage hits all-time highs
Data from Cointelegraph Markets Pro and TradingView showed that BTC/USD remained firmly within its established trading range of $40,000 to $45,000.
With few surprises expected thanks to the Wall Street holiday, traders took the opportunity to call for a weighted approach focusing on altcoins.
Meanwhile, popular analyst William Clemente noted that Bitcoin is bouncing along an ascending trend line this month, approaching a turning point in a wedge pattern soon.
“It should be an interesting week,” he predicted.
Looking beyond the spot price, the data showed that the composition of the market was still using near-unprecedented leverage, with leverage only just beginning to decline in the second week of January.
Such prevalence of leverage previously raised concerns that a liquidity cascade could become even more real, with a significant move up or down affecting traders.
“Bitcoin’s leverage ratio, which has risen sharply and has been at an all-time high for the past few days, raises fears of a massive increase in volatility,” commentator Vince Prince warned that day.
“Technically, if the price of Bitcoin breaks above the $40,000 USD level, that will trigger a lot of the losses.”
Cardano stands out among altcoins
When it comes to altcoins, some moves have deviated from the flat performance seen more broadly.
The top 10 cryptocurrencies by market cap were led by Cardano (ADA), which visibly bucked the sideways trend to post daily gains of almost 9% at the time of writing. This put the price of Cardano at a three-week high.
“Essentially, market psychology is at work on ADA again,” Cointelegraph contributor Michaël van de Poppe summarized.
“Last week the feeling was like a graveyard and the expectations were that it would go south. Now the sentiment is changing and the hype is coming back.”
Cardano daily chart (ADA/USD)
Lower, Litecoin (LTC) made 4.5% gains in a short respite for hodlers.
“Another bounce off strong support. A breakout of blue resistance should send this flying. Not yet,” added LTC/USD trader, analyst, and podcast host Scott Melker.
By William Suberg, Cointelegraph
William Suberg got into bitcoin while finishing his master’s degree and hasn’t looked back since, writing about anything related to cryptocurrency that strikes his fancy. He started working with Cointelegraph in October 2013.
The opinions expressed herein are solely those of the author and do not necessarily reflect the views of Forex Quebec. Every investment and trading move involves risk, you should do your own research when making a decision.
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